iPhone Connection Issues w/XM Satellite

If this has been addressed previously, my apologies for reposting. If someone can forward me the appropriate links, I would appreciate it.

Here is what's going on. I can't seem to figure out how to fix it.

When I start the car, everything syncs up fine - my iPhone connects to the Bluetooth right away. When I'm listening to my iPod, I hear all of my text tones when text comes in. I hear when I get email.

But when I turn on my XM radio, something weird happens. My iPhone becomes muted. I can't hear text tones or email come in. And when I turn off my XM, my iPhone remains muted. I have to turn off my audio system all together and restart it with iPod activated, then I can hear my iPhone again.

Is there something that I'm not activating on my phone or in my car?

Any help would be awesome!

Thanks!